Key legal issues in Football - player transfers

Welcome to the Chris Farnell lawyer blog. Here we will discuss some of the key legal issues that have to be taken into account when players transfer between clubs. The football transfer market is, by its very nature, rife with speculation, and often the general public is left in the dark about the finer legal considerations that help shape the deals. Sports lawyers have the aim of giving their clients the best deal. These are the three points they take into consideration when doing just that. 

Image rights provisions tend to form an increasingly crucial part of high profile football deals, given the importance of generating commercial off field revenue. In the case of high profile players with a genuine commercial value in their image, a separate image rights deal tends to be entered into between the club and the company to which the player’s image has been assigned. This is an important consideration to make when negotiating a transfer.

A players image is crucial to negotiating transfers. Some clubs elect to ring fence certain product and service categories where the player has a pre-existing deal and accept that they will not seek to exploit the player's image in a club context in conjunction with their sponsors who compete with the player's own sponsors; other clubs will still look to exploit the player's image in a club context in conjunction with competitor brands within the parameters of the existing player deal.  Advisors should be very clear in their strategic planning of personal endorsement deals and upon signing for a new club, should be mindful of the likely conflicts or opportunities that club’s sponsors may present to the player personally and for their clubs.

Grounds for termination or reduction in fees of the player is important to work out form the beginning. Clubs want to protect themselves, but the players deserve protecting also. A player or sport has been brought into disrepute will result in the commercial value of the player’s image being diminished. Players’ advisers will inevitably look to tighten the wording of these provisions as much as possible being clear about what constitutes a breach in specific terms. It is important to get this clear from the get-go in order to not avoid problems later on for the player or the club.

Tax indemnities are another area where clubs’ positions vary a lot. Having the right lawyer clear this up for a player or club is important. Some clubs seek an indemnity from the player in the event of HMRC determining that further taxes are due whereas other clubs may agree to share the financial liability in the event that further taxes and National Insurance payments. In the context of a transfer, the commercial and tax position often turns on the player’s bargaining strength and how much the club require his on field services this will often dictate how far the club is prepared to ‘bend’ when negotiating the image rights contract. Ensuring that the deal is right for everyone involved is essential.

Release clauses can operate in different ways. For example, Benteke’s release clause of £32.5m appears to be realistic estimate of his open market value. Read our blog for more important legal considerations coming soon. Find out more about Chris Farnell lawyer online here. Read the latest Chris Farnell lawyer news in the Mirror here.